Claim on Appraiser's E & O

[epi231]

Just as Serena mentioned, it is best to get a second appraisal to be sure that there has been some type of negligent/incompetent work performed by the appraiser. Otherwise you just enrich the lawyer who will probably have to get another appraisal anyways.

 

[JRS at OBX]

Just as Serena mentioned, it is best to get a second appraisal to be sure that there has been some type of negligent/incompetent work performed by the appraiser. Otherwise you just enrich the lawyer who will probably have to get another appraisal anyways.

Not only that, but if you hire me to appraise the property the fee is going to be $zzz. If your attorney hires me to appraise the property, the fee is going to be $zzz+200. It will be the same appraisal for the most part, but I'll charge your attorney more. The attorney won't question it either since he is just going to pass the fee on to you.

 

[Mike Garrett RAA]

Lets make sure everyone has this straight. An appraiser carries E & O insurance in case there is a law suit. It is for the protection of the appraiser. If you feel you have been damaged, hire an attorney. The attorney may decide to file a law suit against the appraiser IF there is evidence of negligence on the part of the appraiser. Once that suit or action is filed, the appraiser then notifies his/her E & O company which, in turn, will defend the appraiser. There is a whole laundry list of things that are exclusions from coverage under errors and omissions.

As I said in another thread where you posted your problem...your next step is to consult your attorney. The attorney will decide if there is a case but I would caution you ... it is going to cost money. If you win the appraiser pays, if you lose, you pay.

Even if the appraiser did, as you claim, not do an interior inspection of the property, there might not be grounds for claiming damages. Usually what happens is the attorney will order another appraisal. If that appraisal is substantially different from the one in question there could be grounds for a law suit claiming damages.

Attn: moderators, this thread and the other one by the same poster should be moved to ASK AN APPRAISER.

 

[Terrel L. Shields]

procure the services of an attorney to sue the appraiser.

exactly.

they can be sued personally

sure. Anyone can sue anyone, but remember that the one sued can counter-sue. You really need firm grounds for a suit or you waste money for both parties...a lawyer's wet dream.

If an appraiser is hired by a bank and the borrower wishes to sue the appraiser, 99 times out of 100 in MANY, if not most, states, the issue of privity squelches the matter instantly. That is, if you are not a named "intended user", you are a third party. In my state, most cases you will have no legal standing to sue from a third party perspective. IF you hired the appraiser directly or IF the appraiser prepared the appraisal as part of a divorce settlement, suit, etc. then perhaps privity will not be an issue.

 

[Smokey Bear]

Sounds like you were the owner? Were you the intended user of the report? If you were NOT the client (usually the lender is), you were not the intended user and would have a harder time suing. Also, if you did not receive a copy of the appraisal prior to the loan being funded, then you have no damages because you did not rely on the report. This is more complicated than just going after an appraiser, you may not have legal standing to sue the appraiser. Best thing to do is first get a review of the appraisal, or get a retrospective appraisal on the property as of the same date of the original appraisal, to find out if the value was supportable. But again, you still might not have standing to sue, it's more complicated than that.

 

[springalot]

Yes, I am the owner. The appraisal was the basis for denying a loan for a buyer (Veteran). I wasn't the intended user, but if it is negligence on the part of the appraiser, then it caused my wife and I damages by losing the sale of our home. We didn't see a copy of the appraisal until after the loan was denied for the buyer based on a low appraised value. I understand the condition of the market, but if you read my threads you'll see where I contend it was mis-measured....verifiable too...and this was the basis of the negligence and incorrect appraised value. I do have a copy of the original appraisal being mailed to me from when we got a loan and bought it from the builder DR Horton in June 07'. Should have it today or early next week.

 

[Alison Swain]

How much sq. ft. are we talking about? I wouldn't put much stock in a builder's version of gross living area or an appraisal that may have relied on it. They pretty generally pad the GLA and the shortage is ususally discovered until a subsequent appraisal is done down the road.

 

[Offshore]

Maybe you could find a real estate lawyers forum.

This was the best reply so far. I agree.

 

[Smokey Bear]

It doesn't sound like you have standing to sue. You weren't even a party to the loan transaction. And builders often classify space as living space that appraisers would treat differently. AND their floor plans are often inaccurate when it comes to square footage. Sounds like you're jumping the gun, the first thing to do would be to get your own independent, unbiased appraisal from an appraiser who knows how to meaure using ANSI standards. But again, you didn't have any legal relationship with the appraiser, it doesn't appear you would have standing to sue.

 

[Heath Boyles]

A descrepancy in size may or may not have an impact on the value of the house. A typical home owner, buyer, or appraiser for that matter may not be able to identify the difference if house A is only slightly larger than house B. Although some builders sell homes on a price per square foot basis, the actual contributory value of a minor discrepancy in size my not result in a higher or lower value. Size discrepancies are not uncommon, especially between differing professions. The roofer says your house is X sf, the builder says somthing else, the county assessor is different. The appraiser is the only one who actually measures the exterior walls with the intention of estimating the actual size.

If you do uncover a significant discrepancy in size after seeking an accurate measurement, I would go down and talk to Mr. Horton to get an explanation.